Local councils losing billions due to poor use of technology and data

Technology could help local authorities to avoid losing more than £1.3bn a year in tax fraud, claims report

Technology could help local authorities avoid losing more than £1.3bn a year in tax fraud, according to a report.

Data collected from different available sources could be used to predict the likelihood of Council Tax fraud, benefit fraud and housing tenancy fraud to prevent this loss of funds.

The document by the Policy Exchange explained how smarter use of technology and data could prevent fraud, funding cuts and the need to close services.

“While there are examples of innovative councils that have used technology and data to deliver better, more efficient public services, many local authorities have failed to reform,” said report author Eddie Copeland, head of technology policy at Policy Exchange.

“Using technology and data in a smart way could save local authorities £10bn by the end of the next parliament – money which could be better targeted at helping some of the most vulnerable in our communities,” he said.

Transformation barriers

The single greatest barrier to achieving a technology-enabled reform for local councils is fragmentation throughout the sector, claimed the report.

But as each local council has its own IT infrastructure, replacing each interconnected system will cost too much, leading to new IT being layered on top of old systems, similar to the financial services industry.

This causes the tendency to focus on physical IT as opposed to data, and creates a constant battle between centralisation and localism when creating digital plans.

“The dominant narrative has been that the sector can have either local innovation and democracy, at the cost of duplication and inefficiency, or a Local Government Digital Service that dictates from the centre, saving money but disempowering local communities,” said the report.

To resolve these issues, the report proposed an outline for a digital government that provides better citizen services and promotes local innovation without duplication or inefficiency by phasing out bespoke IT systems and replacing them with an outsourced app store, where external businesses create low-cost services that can be used by hundreds of local authorities where needed.

The report also suggested sharing data between local councils may be more effective than each of them having individual systems.

But Natalie Bateman, head of health, social care and local government at techUK, pointed out that local authorities sometimes lack the skills and resources needed to properly use the digital agenda to transform delivery of services.

Using technology and data in a smart way could save local authorities £10bn by the end of the next parliament

Eddie Copeland, Policy Exchange

“To mirror some of the progress being made in central government, a body with a similar remit to the Government Digital Service [GDS] should be established to act at the regional level to help local authorities identify the common building blocks of software, hardware and processes that can be standardised and commoditised across local government,” she said.

“Development of common approaches to support transformational change and cogent engagement in a cost-effective way with suppliers also needs to be emphasised. However, we see this as setting frameworks for the local authorities to operate within to accelerate delivery of technology through best practice, and not a centralised approach,” added Bateman.

United digital services

The Policy Exchange report proposed several ways to improve the public sector as a whole, including compatible data stores and an Office of Data Responsibility to provide guidance about data sharing across government.

“A newly appointed government chief data officer should work with representatives from local government, central government departments, other public sector bodies and industry, to define – and continuously update – open standards for data for the entire public sector,” read the report.

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